Mr. Trudeau’s central pledge is to “grow the economy.” And now, he has a master plan – a bold new plan to kick Canada into high gear by making us a magnet for foreign investment and massively increasing immigration. It is super ambitious. … What could possibly go wrong?
What could go wrong is a massive mismatch of expectations to results. The risk of a failure to deliver is high. And the prospects for delivering what millennials want most – affordable housing anywhere in the vicinity of Vancouver and Toronto, more good jobs with higher take-home pay and benefits – are low.
Mr. Trudeau makes the economy sound like a neglected garden that just needs more water, fertilizer, and a good weeding to perk it up. But the truth is that no one knows how to kick-start the economy. No two experts can agree on what might work.
In the past few years, economies around the world have stalled. That stagnation is a major factor in the political unrest that is rocking Europe and the United States. In Canada, we dream of a return to the good old days, when the GDP grew by 3.5 per cent a year. But it’s entirely possible the good old days aren’t coming back. The Bank of Canadakeeps ratcheting its forecasts down: It now says growth will be 1.1 per cent this year, and 2 per cent in 2017. Over time, that small difference between then and now becomes huge. At a 3.5-per-cent growth rate, wealth doubles every 20 years. At 2 per cent, it takes 35 years.